Faced with the possibility of running out of money, the U.S. Postal service asks Congress to consider 'drastic measures'

Changes to USPS mail delivery have an outsized
impact on rural Americans. (Photo by D. Trinks, Unsplash)

Expensive delivery obligations and government constraints both contribute to the U.S. Postal Service's deepening financial woes. "In testimony to Congress last month, David Steiner, the postmaster general, delivered a dire warning," reports Adam Sella of The New York Times. "Without drastic measures, he said, the U.S. Postal Service could run out of cash in less than a year."

Some of the "drastic measures" Steiner outlined included reducing service days from 6 to 5, dropping "unprofitable routes," and closing some smaller post offices, Sella writes. All three changes would have an outsized impact on rural communities that other carriers, such as FedEx and UPS, avoid due to higher costs.

A large part of the agency's financial turmoil can be blamed on what Congress has tasked it with doing, which doesn't create a profitable business model (which is why UPS and FedEx don't do it), and federal limitations on its financial options, including pricing and pension investments.

For instance, USPS is supposed to be financially self-sufficient while meeting its universal service obligation, which requires it to deliver to everyone in the United States at a reasonable price, Sella explains. "In 2022, Congress added a six-day-a-week delivery requirement. . . .That commitment has cost the agency money: more than $6.5 billion a year."

USPS is also restricted on pricing. "It must get approval from an independent regulatory commission, which limits the agency’s ability to raise prices," Sella reports. Congress also limits its borrowing power, which means it can run out of money.

USPS leadership isn't allowed pension portfolio flexibility, which could have a dramatic impact on its bottom line. Sella explains, "The Postal Service is only allowed to invest its retirement funds in Treasury notes. The Postal Service’s Office of Inspector General estimated in 2023 that USPS retirement funds would have been worth approximately $800 billion more if they had been able to be invested in a mix of 60% stocks and 40% Treasury bonds."

Meanwhile, USPS has turned to one of its few reliable revenue streams: postal price increases. "The commission approved a temporary surcharge of 8% on packages, in light of rising fuel and transportation costs," Sella reports. The Postal Service also requested a 5% increase in first-class mail rates. "That means first-class mail 'forever' stamps would increase from 78 cents to 82 cents."

Amazon's rural hubs speed up reliable delivery. In 4 years, the company could deliver to every U.S. ZIP code.

A look inside Amazon's 17,000-square-foot Missoula facility. 
(Photo by Eric Dietrich, Montana Free Press)

Amazon is betting that its rural hub expansion plans will help it increase sales and delivery services to its more remote-living customers while lessening its dependence on the U.S. Postal Service, reports Sean McLain of The Wall Street Journal. The company "aims ultimately to have 200 rural delivery hubs serving around 13,000 ZIP Codes covering around 1.2 million square miles of America — an area the size of Texas, California and Alaska combined."

By opening rural hubs, Amazon hopes to "reduce its reliance on the U.S. Postal Service, a relationship that has become rocky following a dispute over contract terms," McLain writes. The company has also used United Parcel Service to complete the final leg of deliveries, which hasn't always gone smoothly either. "In 2013, a sudden surge in Amazon orders overwhelmed UPS, causing some packages to not make it in time for Christmas."

Residents in Conner, Montana, who used to wait about a week for their packages to arrive, are already reaping the benefits of speedy deliveries from the rural hub Amazon built on the outskirts of Missoula. Now most Conner-bound packages arrive within Amazon's traditional two-day window. McLain adds, "Around 14,000 packages leave the [Missoula] warehouse on an average day."

Rural Amazon routes require delivery drivers to carefully plan and be ready to handle extreme weather, big horn sheep, dirt or mud roads, high winds and mountain passes. McLain reports, "Deliveries to the Missoula warehouse come from a large urban hub in Spokane, Wash., a three-hour drive across two mountain passes."

Despite backcountry travel and weather challenges, Amazon plans to "construct around 40 to 50 new delivery hubs a year," McLain reports. At that pace, the company should "be able to ship packages to every U.S. ZIP Code in four years."

Congress could change USPS finances and avoid more service cuts that disproportionately hurt rural areas

Rural residents are more dependent on 
the USPS. (Photo by A. Land, Unsplash)

The U.S. Postal Service can't borrow any more money to cover ongoing deficits, and unless changes to its funding are made, USPS leadership has warned that the service will run out of money sometime in 2026. Elena Patel reports for Brookings.  "This fiscal crisis reflects a structural mismatch between what Congress requires the Postal Service to do and how it is financed."

When the USPS was created, its financial foundations included a monopoly on letter delivery tied to a universal service mandate; however, as the number of letters mailed in the U.S. steadily declined beginning in 2007, the universal service requirement remained in place. The lack of letter revenue essentially meant USPS could no longer afford to deliver to all 169 million addresses that Congress mandated it serve with affordable rates.

Once letter revenue tanked, the USPS still delivered to every address despite the financial toll. "The USPS nationwide delivery network ensures that access does not depend on geography or profitability," Patel explains.

Brookings graph, from USPS Form 10-K Operating Statistics, FY 2007–2025.

For rural communities, USPS mail carriers often go the "last mile" to complete a delivery. The mail is a backbone for small-town businesses, finances and even medical care. Patel writes, "Particularly in low-density and rural communities, the mail remains essential infrastructure. It delivers prescription medications, ballots, and online purchases, and it supports local small-business activity."

Patel suggests some USPS changes that Congress could enact, which are edited for brevity below.

• Restructure pension liability finances, "including shifting these costs to the Treasury, as is done for other federal agencies."
• Pay universal service costs: "The cost of the universal service obligation exceeded the value of the postal monopoly by roughly $2-$3 billion per year for the last several years. . . . Congress could fund that mandate explicitly through annual appropriations."
• Increase the USPS borrowing cap and allocate funds for infrastructure improvements. "Additional capital flexibility could ease short-term liquidity pressures and allow USPS to finance modernization over time rather than from current cash flows."

Congress can "realign the financing framework with the universal service mandate it has imposed," Patel adds. "Or it can allow liquidity constraints to narrow that mandate by default. In practice, that 'default' path would likely involve deferred payments, delayed investment, and increased pressure for service cuts that fall most heavily on the communities most reliant on the mail."

Quick hits: Mail riders of the past; the future of meat; child care solution; Thoreau's cabin; PFAS-free water

A mail rider makes his way through a creek bed near
Jackson, Ky., in 1940. (Library of Congress photo)

Over hill and dale and on all kinds of trails, horseback postal routes required mail riders to face treacherous paths, wild weather, unpredictable wildlife and inaccurate maps. "Routes they took were originally Native American and traders’ paths and roads carved through the forests, river valleys and mountains," writes Todd Kozak for Lancaster Farming. "Post riders and their horses worked in all weather and on set schedules. . . . A map of post routes published by the post office in 1897 shows a myriad of routes and offices. By the early 1920s, most of them had vanished."

Human diets of the future might not be about going vegan, quitting bacon or eschewing beef. Instead, Bruce Friedrich, author of Meat: How the Next Agricultural Revolution Will Transform Humanity’s Favorite Food and Our Future, presents "alternative meat" as the planet's best answer. "And to be clear, he’s not talking about gardenburgers or tofurkey," writes Sarah Isgur of The Dispatch. "We now have the ability to take real meat cells from an animal and replicate them. The product is actually meat, but it’s not from a dead animal. . . . Alternative meat can’t compete by being better for the environment or nicer for animals. For most people, he acknowledges, food is not an ethical decision. It has to taste as good and be as cheap. . . ."

At Little Break, parents can be on-site with their 
children and still get their work done. (Little Break photo)

For parents struggling to find affordable child care, a new model being used in Michigan offers a solution that combines parental work spaces with a child care center. "Users say its prices are a fraction of what other daycare centers charge," reports Anna Patton of Reasons to be Cheerful. "Little Break" is a nonprofit, non-licensed child care facility where "parents must remain on-site, and take care of feeding and diaper changes. Otherwise, they get on with work in an adjoining room, while paid staff. . . watch the children." An added perk of the model is that parents can be there to witness childhood milestones they would otherwise miss.

Tired of their current work lives, some mid-career professionals have left their jobs and trained in a trade. "At 27, Lauren O’Connor was living paycheck to paycheck as a Montessori teacher, making $29 an hour with no benefits," report Allison Pohle and Te-Ping Chen of The Wall Street Journal. "Today, the 33-year-old earns $45 an hour — brazing, welding and soldering pipes for a local contractor. Though she sees more women on job sites these days, it wasn’t that way at first. Proving herself to the guys was stressful, she says." Other trades career-changers took up were airline pilot, electrical apprentice and cardiovascular sonographer.

 Original title page of Walden featuring a 
picture drawn by Thoreau's sister Sophia.

Among more modern fans of Henry David Thoreau's 1854 book, Walden or Life in the Woods, a group is building "full-scale replicas" of the late transcendentalist's cabin, reports Dorie Chevlen of The New York Times. Thoreau's book, which centers on simple life and self-reliance, recounts how he built his little cabin all on his own, except when neighbors helped him raise the frame. Two brothers, Jasper and Satchel Sieniewicz, who worked together to build a replica, "can’t believe it was a one man job. . . . Even using a sawmill and power tools, it took them three summers of labor ... Thoreau was living in his cabin in under three months." Read how other Thoreau fans fared with their Walden cabins here. 

In the small community of Rothschild, Wis., the water is healthier because it's nearly PFAS free. PFAS, also known as "forever chemicals," can cause devastating health issues for humans. The village used settlement dollars to build a new water treatment facility. "This facility is actively working to decrease the levels of PFAS in the community's drinking water," reports Dylan Eckhart of WAOW. The Rothschild plant "utilizes a granular activated carbon filtration system to remove PFAS. . . .PFAS contamination became a concern for Rothschild residents in 2022 when it was detected in a sample from village wells."

The day a letter is mailed at a U.S. Post Office may no longer be the day it is postmarked

A USPS postmark is now stamped at regional facilities.
(Adobe Stock photo)

Few ink stamps are as crucial to meeting modern deadlines as the U.S. Postal Service postmark; however, at the end of last month, USPS changed its transportation and stamping processes, potentially delaying when mail is physically postmarked.

Beginning on Dec. 24, a postmark "no longer shows the date you deposited a piece of mail with the U.S. Postal Service," reports Esther Fung of The Wall Street Journal. Instead, mail will be postmarked when it's processed at a regional facility, which could be days after it's mailed locally.

The USPS changed its postmark rule "as part of long-running efforts to modernize and cut costs," Fung writes. "Reducing postal-truck runs between processing facilities and local post offices can cut costs and emissions."

While the USPS doesn't classify postmarking as part of "its services," many systems and people, including the Internal Revenue Service, legal professionals, election officials and health insurers, use postmarks as evidence that something mailed met a set deadline.

The best way to ensure an important piece of mail gets postmarked on time is to go to the post office where it can be manually stamped. Fung adds, "Yet, that could be hard for people living in rural areas far from a post office."

For deadline-mandated postmarks on items such as taxes, college applications, and health insurance appeals, experts recommend mailing documents several days in advance, so the mail has time to reach the processing facility for its official postmark.

Supreme Court's ruling on mail-in ballot deadlines could have an outsized impact in rural areas

Both Republicans and Democrats have large numbers
of voters who mail their ballots. (Adobe Stock photo)

The U.S. Supreme Court plans to rule on mail-in ballot deadlines this term, which could have an outsized impact on a subset of voters, including thousands of rural voters, should the court decide that ballots arriving after Election Day must be tossed.

The case centers on a Mississippi law that allows mailed ballots to be counted even when they arrive after Election Day, but roughly "18 states and territories accept such late-arriving ballots as long as they are postmarked by Election Day," report Nick Corasaniti and Christine Zhang of The New York Times.

Should the court decide that all votes must be received by Election Day, mail-in voters from rural areas will be challenged to mail their votes early enough to be counted.

Voters in the southwestern town of Medford, Oregon, provide a good example. When a Medford voter mails a ballot from the local post office, it doesn't go to the "town clerk’s office only a few miles away," the Times reports. "Instead, it travels about 280 miles north on Interstate 5 to Portland, to get a postmark stamped, before returning to the Medford elections office to be counted."

Rural mail services are also more likely to be delayed by local weather conditions or traffic bottlenecks due to bad weather or natural disasters far from their zip codes.

States with sprawling rural areas and high electoral college numbers, such as California, Texas, Illinois, and New York, currently allow late-arriving ballots to be counted. Should the Supreme Court ax that allowance, both parties could see Election Day impacts.

No matter what the Supreme Court decides, ongoing election education can remind citizens how and when to vote. David Becker, from the Center for Election Innovation and Research, told the Times, "For people who are voting once every four years, or once every two years, they’re not familiar with all these procedures and changes."